.NET 3.5 now includes built-in support for all ASP.NET AJAX
1.0 features. I'll be doing more blog posts in the future that also
describe how to take advantage of the new features it provides.
You can use VS 2008 to target both existing ASP.NET
applications built with ASP.NET AJAX 1.0, as well as target the new version of
ASP.NET AJAX built-into .NET 3.5. The VS Web Tools team blog posts above
should help walk you though the step-by-step instructions on how to-do both.
Hope this helps,